New Default Energy Rates Announced: How to Stay Ahead of FY26 Price Changes with Choice Energy

The end of the 24/25FY is here, which means energy prices are set to increase and could have a direct impact on your operational costs.

From July 1, 2025, for businesses in Queensland, New South Wales, and South Australia, and August 1, 2025, for those in Victoria and Tasmania, new energy Default Market Offers (DMO) and Victorian Default Offers (VDO) will come into effect.

While these "default offers" act as a safety net, capping prices for businesses on standard retail plans, they often don't represent the most competitive rates available. The announced changes highlight a mixed outlook, with some regions facing significant price adjustments.

 

What's Changing and Why It Matters:

The Australian Energy Regulator (AER) and Victoria's Essential Services Commission (ESC) have finalised their default offer determinations for the 2025-26 financial year. Factors like wholesale energy costs, network charges, and evolving market dynamics drive these changes.

• New South Wales (NSW), South Australia (SA) & South East Queensland (SEQ): Small business customers on standing offers could see price increases. In NSW, increases range from 7.9% to 8.5% depending on your distribution zone. South Australian businesses could face increases of around 3.5%, while South East Queensland will see more modest increases of approximately 0.8%.
• Victoria (VIC) & Tasmania (TAS): Victorian small businesses on the VDO are expected to see an average annual bill increase of around 3%. In Tasmania, regulated electricity prices for small businesses are projected to increase by an average of 0.50% from July 1, 2025, with changes to tariff structures.

These default rates are indicative; many energy retailers are also adjusting their market offers. This means that even if your default offer sees a smaller increase, a better deal could be waiting in the market.

 

Your Proactive Energy Strategy: Two Essential Steps

Every dollar saved is a dollar reinvested into your business. Proactively managing your energy costs is no longer optional – it's essential.

1. Review Against FY26 Offers: Choice Energy is already equipped with the latest FY26 energy offers from various retailers. This is your immediate opportunity to compare your current FY25 pricing against these new market offers. Don't assume your existing plan is still competitive; a tailored market offer could unlock significant savings.
   
2. Conduct a Network Tariff Assessment: This is often the most overlooked and impactful area for savings. Your network tariff is the charge for using the poles, wires, and infrastructure that delivers electricity to your premises, and it can account for over 60% of your total energy bill. These charges are set by your electricity distributor and are based on your usage patterns. If your business has evolved – perhaps with new machinery, altered operating hours, or seasonal shifts – your current network tariff might be costing you unnecessarily.
   
   A detailed Network Tariff Assessment involves analysing your historical energy usage (ideally 12 months of interval data) to determine if a more cost-effective tariff structure is available. This could mean switching to a time-of-use tariff to leverage off-peak periods or optimising demand charges, which are based on your highest usage spikes. Choice Energy offers free network tariff reviews, working directly with your electricity distributor to manage any necessary changes seamlessly. 

AFC MEMBER OFFER

As an exclusive benefit for AFC members, Choice Energy is offering $1500 cashback when you install a 20kW or larger solar system, plus a complimentary energy bill health check to help reduce your electricity and gas costs.

To access your member offer, click here.